How will the new high-skilled worker visa rules affect Silicon Valley?

If they want to recruit foreign talent this year, Facebook and Google may have to wait.  

US Citizenship and Immigration Services (USCIS) announced a six-month suspension of the H-1B expedited service option on Friday, an adjustment many suspect is the first in a more serious reform effort by the Trump administration.

Silicon Valley opposed Trump’s travel ban as well, but the unintended consequences of the H-1B visa program has made it enemies on both sides of the aisle.

H-1B’s stated purpose is to attract highly educated specialists to US jobs that companies can’t fill, and while it applies to a number of industries, the majority of recipients work in technology. A 2015 USCIS report to Congress found that the previous year, 65 percent of approved petitions were for computer-related jobs. Facebook is classified as an “H-1B dependent” company, with more than 15 percent of its employees relying on the program.

The visas are good for three years, after which they can be extended for another three.

The “premium processing” option, first introduced in 2001, allowed companies to pay an extra $1,225 to have their petitions reviewed in two weeks, rather than the usual two to three months. As of April 3rd, that service is dead, although USCIS says that an expedited option will remain available in special cases such in emergencies and for humanitarian reasons.  

USCIS claims the measure is necessary to work through a backlog of applications, but this explanation confuses some, who point out that faster processing was cited as a reason for the premium option in the first place.

The change has the potential to make big waves in the tech industry, where as many as 1 million H-1B visa holders make up 13 percent of technology jobs, according to The New York Times. The program grants up to 85,000 visas each year across all sectors, but more than 300,000 apply, resulting in a lottery system some find unfair.

That lottery is coming up in April, which may explain the timing of the change. The announcement came down almost simultaneously with the publishing of a letter from Sen. Richard Durbin (D) of Illinois asking Trump to revamp the law and replace the lottery with a system prioritizing graduates of US universities and the highest-paid workers.

“If you do not take action in the next few weeks, outsourcers will secure the right to import tens of thousands of low-wage foreign guest workers to replace American workers,” Sen. Durbin wrote.

He refers to the common complaint that foreign companies game the system by flooding the government with applications, hire workers for temporary training at half the standard salary, then rotate them back to the home country.

But some think American companies are unfairly benefiting from the program as well, hiring young, foreign workers for less than they would have to pay more experienced Americans.

“The law supposedly forbids underpaying, but the wages it sets are well below market rates. And the law allows hiring young H-1Bs instead of older Americans, at a big cost savings,“ Norman Matloff, a professor of computer science at UC Davis tells The Christian Science Monitor in an email.

In Dr. Matloff’s opinion, not even the H-1B recipients are winners. He calls them “de facto indentured servants,” since workers almost always stay at the sponsoring company for the entire three-year period of the visa, a rarity in the fast-moving tech job market. 

“I feel like a lot of H-1B holders are kind of held hostage to staying at their company,” says an employee of a large Bay Area tech company, who asked not to be named for fear of retribution.

Matloff proposes a number of reforms, including making visa holders waiting for green cards “free to change employers at any time.”

The new rules don’t address those concerns yet, but many think this is just the opening salvo in a complete overhaul of the system, which Trump made a cornerstone of his immigration policy during the campaign.

"I will end forever the H-1B as a cheap labor program, and institute an absolute requirement to hire American workers first for every visa and immigration program," he wrote in a statement on his campaign website.

Meanwhile, Silicon Valley is hunkering down amidst the uncertainty, with some companies putting off H-1B applications until the situation settles down, Dick Burke, CEO of a company that helps companies secure work permits, told Bloomberg.

And they might not have long to wait. Both Democratic and Republican reform bills are already under consideration in Congress.